By Silvia Nyambura
Growing customer base is key to reducing electricity tariffs, Umeme Board Chairman Patrick Bitature has said. Currently 91% of the utility company’s revenues come from 10% of the customers. According to Bitature, this equation needs to be reversed.
He was addressing journalists at the sidelines of the company’s Annual General Meeting (AGM) held in the week ending 22nd May 2015. Bitature explained the more customers the company has, the lower the tariff will become. This however will depend highly on the level of investment. Based on usage, domestic tariffs go for between Ushs 159 and Ushs 520 per unit while commercial tariffs are between Ushs 354 and 570.
The company’s financial reports indicate customer connections grew by 13% in 2014 with 76,000 new customers coming onto the grid. This brings the total to about 651,000 customers. In addition, Umeme invested close to Ushs 370 billion in prepayment roll out, loss reduction and infrastructure to improve quality of supply.
Selestino Babungi the company’s new Managing Director said this investment helped grow revenue collections where 99.1% of sales were collected last year.
“This growth was also supported by internal strategies but most importantly, prepayment metering. At the moment 35% of our customers are on prepaid metering which offers a good service experience. Last year a decision was made in October that all new customers get on the prepaid platform and we expect to have moved all clients to this platform by 2018. I believe we are on track,
